Cash-strapped Pakistan has secured a USD 655 million financing package, including an expensive USD 300 million loan at market rates, from the Asian Development Bank, days after Finance Minister Shamshad Akhtar declared the country’s public debt as “unsustainable”.
The ADB approved a financing package for Pakistan under three different loans. Among other components, these include USD 300 million for improving domestic resource mobilisation; USD 275 million for rehabilitating schools damaged by the devastating August 2022 floods; and USD 80 million for enhancing agricultural productivity to improve food security, according to an announcement by the ADB on Wednesday.
The announcement by the Manila-based lending agency came as the World Bank’s Debt Management and Sustainability Mission met with Finance Minister AKhtar to review the debt management of the country, reported the Express Tribune newspaper.
The official handout stated that the USD 300 million policy-based loan will support the initiative’s first sub-programme, which focuses on laying the foundation for reforms to policies, laws, and institutional capacity that will improve domestic resource mobilisation and utilisation.
The Express Tribune reported that the ongoing Sindh Secondary Education Improvement Project will receive additional financing—a USD 275 million emergency assistance loan that is part of ADB’s USD 1.5 billion pledge of support for Pakistan’s recovery from the devastating 2022 floods, according to the ADB.
A concessional loan of USD 80 million for the Khyber Pakhtunkhwa Food Security Support Project, which is also part of ADB’s USD 1.5 billion pledge of support for Pakistan’s recovery from the 2022 floods, will help address climate vulnerabilities, enhance food security, and boost the livelihoods of rural farm households in the most flood-damaged districts in the province, said the ADB
